Judgment liens are involuntary and give a creditor the ability to seek foreclosure in order to receive payment. If you are sued and the plaintiff is granted damages and you are unable to pay those damages through insurance or personal assets, they may become a “judgment creditor” and you a “judgment debtor.” This means that through the Judgment, you owe a debt to the plaintiff. The plaintiff may receive payment through garnishing wages, taking bank accounts or a lien against your property. If they are given a lien against your property they may call for foreclosure in order to receive payment. Essentially you may become a debtor through a monetary court judgment.
The state and federal governments declare some assets as exempt. The debtor is allowed to keep certain property so that they are not hurt past financial repair. Exempt assets include, but are not limited to: motor vehicles, necessary clothing, necessary household goods, household appliances, jewelry up to a certain value, pensions, some of the equity in the home, tools of their trade, some of unpaid earned wages, public benefits, and damages awarded for personal injury. The exemptions can vary depending on the state and must be compared the federal exemptions.
If the asset is exempt, then you can determine whether the lien is a type that can be eliminated. Generally, judgment liens can be eliminated and consensual and statutory liens cannot be.
If the amount of the lien impairs the exemption, you must determine the amount of the lien that can’t be removed. The can be found by taking the value of the asset, minus the amount that is exempt. If the asset has an unlimited exemption, the entire lien can be eradicated.